Is WMS eyeingMikohn Gaming?

Jan 9, 2001 6:24 AM

FIRST THE CASINOS . . . Now the Game Vendors! No one is talking, but it’s a safe bet that where there’s smoke, there’s fire. And, smoking up the rumor line are consolidation reports that WMS Gaming (WMS) is courting Mikohn Gaming (MIKNE).

If there is fire underneath the smoke (I think there is!), it might be worthy of consideration.

Mikohn closed at 3 Monday — a notch or so above its 52-week low of 21/8 and sharply under its 52-week high of 93/16.

The Las Vegas-based company is on the Top Twenty list of gaming products — this year and last. Currently, it has a red-hot, multi-line, video slots

game based on Hasbro’s famous Battle Ship. It pits players in a classic game of naval combat. Last year MIKNE made headlines with its popular Yahtzee.

On the other side of the equation is WMS Gaming, which has a variety of new games making a name for them in the casino industry.

WMS’ 52-week low is 73/8. The 52-week high is 237/8. It closed Monday at 85/16, down 3/8.

Neither David J. Thompson, chairman and CEO of Mikohn, nor Brian Gamache, top gun at WMS would comment about the unconfirmed reports.

UNLV OR UCLA? Will Rick Pitino head for Las Vegas or Los Angeles to coach college basketball?

If that becomes a betting proposition (it won’t), then bet UCLA is on the front road of the memory of his mind.

"The buzz is that Steve and Elaine Wynn have talked to Rick about coming to UNLV," said a pipe. "That may be true, but I do believe UCLA has more appeal. Besides, with a $1.5 million severance package coming his way from the Celtics, one might expect Rick to sit cozy for a while until the right opportunity comes along."

SAY IT ISN’T SO! The poor performance of the Las Vegas Hilton is estimated to have cost Park Place Entertainment (PPE) about $20 million during the company’s fourth quarter, which ended at year-end.

Is it any wonder that Los Angeles developer Ed Roski Jr. can’t find money to complete the $300 million-plus acquisition of the off-Strip resort?

I had anticipated that Roski would be able to transform the "white elephant" into a locals-oriented property. It now appears that won’t happen. At the same time, how is Park Place going to stop the hemorrhaging?

More PPE head scratching: An in-the-knowster (wiser than a regular pipe) telephoned. He wanted us to know that Park Place is negotiating to extend its lease on its Caesars Tahoe resort in Lake Tahoe, Nev.

He said the lease was to expire in 2004. He can’t think of any good reason why Park Place would want to extend. It’s been mainly a loser down through the years. Caesars World took up the chase in 1983. With the use of casino promotions aimed at whales, Caesars Tahoe went from losing $28 million to making a few bucks going up hill every step of the way.

SEX TO MAKE COMEBACK! It’s funny how times change. Once GamingToday was widely criticized in some circles for its back page swimsuit girl, which has appeared in every edition since its inception in 1976. Many members of the distaff set mounted protests. They threatened to urge advertisers not to support what they termed a sexist attitude.

It really got hot and heavy for a while and we decided to put it to a vote of our readers. The girl must go! The girl must stay! Overwhelmingly, the message was clear: our back page girl — properly clad in a swimsuit — must stay. And stay she did.

It seems an 18-month study commissioned by the Las Vegas Convention and Visitors Authority convinced the casino industry to bring back Las Vegas’ old sex appeal.

"It’s part of the sizzle and the sell," said Bill Hornbuckle, president of MGM MIRAGE’s (MGG) MGM Grand Casino Hotel.

Forget the high-hat chefs, golf courses, swimming pools and the many theme parks up and down the Strip. Beginning this week, Las Vegas is going to try to re-capture the naughty, mysterious and very adult visitor with a high-priced advertising campaign.

And, it says here, our back page girl is back in vogue again.

OUCH! That sounds like the sound coming from the top guns at Harrah’s New Orleans casino when they did a second count and discovered that the group has $641.7 million in liabilities and $87 million in assets. In case your calculator isn’t at your fingertips, that comes out to be a case of the shorts to the tune of $554.7 million.

"It came to light over the weekend when the Canal Street club gave us a second look at its Chapter 11 Bankruptcy protection files," said a pipe in Jazz City.

More: "A big chunk of liability includes $549 million owed to banks, creditors and bond holders. Lawyers will be coming from out of the woodwork as lawsuits begin to mount. One already threatens. It seems as if the city might attempt to take over the building if the place closes. JCC Holdings, which has bankrolled the casino, has legitimate claim. But, according to the lease, ownership would revert to the city if the casino goes el foldo.

"It is a cinch to become an arm-wrestling match if that happens. A bankruptcy judge will be called upon as the third man in the ring.

"What a mess. No wonder Harrah’s Entertainment (HET) held on so tightly for so long."

CHUG . . . CHUG! Amid disappointing earnings in many of its casino operations (the casino giant warned investors last week that it expects to report no profit for the fourth quarter), Park Place Entertainment (PPE) finds joy in the operation of the world’s largest floating casino.

"They call it The Glory of Rome. It’s a $425 million project with four decks, just down river from Louisville, Ky., in Harrison County, Ind.

"Revenues appear to be up sharply. The riverboat revenues for the year 2000 are estimated at $185 million vs. $157 million in 1999," said a pipe.

"I talked to Barry Morris, the riverboat’s GM: ‘We’re finally starting to live up to expectations . . . The investment is definitely beginning to pay off.’"

CASH REGISTER RINGING? Las Vegas game developer DP Stud was overjoyed in announcing that the company has an agreement to place no-commission baccarat in the Pala Casino now under construction in Temecula, Calif.

The John Piccoli-run operation owns and distributes the patented game.

A DAN CHANDLER NAMESAKE? A well-meant 2-year-old by the name of Chandlerthehandler, named after legendary casino executive Dan Chandler, went off the favorite Sunday in a maiden race at Santa Anita.

The Michael Pegram charge, trained by Bob Baffert, went off as the 2-1 favorite in a field of 12 going 6 1/2 furlongs on the dirt. Chandlerthehandler got caught up in a speed duel and went willingly until running out of steam, finishing fourth in a blanket finish, beaten a half length, a head and a nose.

Watch out for Chandlerthehandler, not to mention Dan Chandler.

MOVING UPTOWN! WMS Industries Inc. (WMS) is moving its operations to Waukegan, Ill., about 30 miles north of Chicago. Its old Chicago facility will be converted into a technology campus for its product redevelopment group.

There the company is well positioned for continued growth with a new 236,000-square-foot, state-of-the-art, manufacturing and distribution facility with growing room. The new digs are situated on 38 acres of WMS-owned land.

What will it cost? About 7 to 9 cents a share for Fiscal 2001.